§ Mrs. ShephardTo ask the Chancellor of the Exchequer if he will set out the calculations on which the 40 p per litre duty rebate on liquefied petroleum gas are based. [134365]
§ John HealeyThe Government offers lower duty rates for less environmentally-damaging fuels by offering duty differentials relative to the main road fuels. These differentials are intended primarily to reflect the relative environmental benefits individual. In determining the size of the duty incentive for liquefied petroleum gas (LPG), the Government took into account principally the environmental benefits of the fuel, such as local air quality improvements. It also took account of the significant market barriers faced by LPG: it requires a dedicated and separate re-fuelling infrastructure and vehicles have to be converted or specifically designed to use gaseous fuels.
In his 2003 Budget statement, my right hon. Friend, the Chancellor announced that the Government would consult on support for road fuel gases beyond 2004. The Department for Transport, HM Treasury and Customs and Excise published a consultation document in June inviting key stakeholders and users to express their views on how to ensure that both the duty payable and the purchase grants available for road fuel gases continue to reflect environmental and other policy objectives.